Tuesday, November 21, 2006

Love is in the air...if love is anhydrous ammonia


Yes folks, its that time of the year when you start seeing big white tubes being pulled around in fields. Anhydrous ammonia, or NH3 if you are chemically inclined, is what's in those tanks. It is injected into the soil to provide nitrogen for next year's corn crop.

One tank can hold around 2 tons of NH3, and a ton is selling for about $415. A tank's worth of NH3 can be applied to between 20 and 27 acres, depending on the desired rate. Safety goggles and rubber gloves are a must when handling this stuff - when connecting or disconnecting the hoses there might be a little NH3 left, which will fall out as a liquid and start to boil immediately. However, it is very cold, and you oftentimes can feel it through the rubber gloves.

I was hauling corn to the elevator in town today. It just so happens that the pit where I dump was down wind from the NH3 filing platform. On the tanks being filled a vapor valve is cracked open to show when the tank is full. Of course, ammonia vapor gets released, and every so often you'd get a nice sinus cleaning whiff. Think of your household ammonia products and multiply it by 10, and you get the idea.

So, why do farmers use this dangerous stuff? It's lower cost than most nitrogen alternatives, and it is a concentrated form of nitrogen, meaning less needs to be hauled to the field for the same rate per acre. Why are they putting it on about 7 months before the crop will need it? The NH3 will immobilize in the cold soil over the winter and will (mostly) be there in the spring and summer.

A friend of mine was lucky the other day - he was going from one field to another with his NH3 applicator and a tank of NH3 behind. All of a sudden, the NH3 valve opened and ammonia came shooting out the knives, causing a cloud of ammonia. He found that his rate controller, turned on, had a pinched wire that caused the valve to open. From then on he made sure he turned off the controller and closed the tank valve when transporting. Luckily no one was hurt.

I use NH3, and will have some custom applied this fall. I plan on putting more this next spring, as I feel more of it will be available to the corn plant than later. However, a lot of my acres (especially no-till acres) will receive a liquid by-product from the Anjimoto Heartland lysine plant in Eddyville, IA. A custom applicator puts on 200 gallons/acre of this stuff, which looks like hot chocolate cake batter. I've had good success with it in the past, and is cost effective with NH3.

10 Comments:

Blogger IrishWalsh said...

Meth for corn.

Hey, whatever makes it grow tall and profitable.

9:08 PM, November 21, 2006  
Blogger bgunzy said...

Well, we're not feeding any Sudafed and starter fluid to the corn, so its not technically "meth". :)

Not ripping on you personally, Walsh, but its kind of a sign o' the times when a non-farmer instantly associates NH3 to meth instead of fertilizer.

7:49 AM, November 22, 2006  
Anonymous DEM said...

Bgunzy- thanks for the anhydrous explanation- I've always wondered, but didn't know anyone who used it. Can you explain some of the economics of grain farming when you've got a chance? From my limited perspective, it seems like a long-term, no-win situation:
Variable costs: Machinery, fuel, seed, fertilizer (tied to oil), labor
Fixed costs: Property taxes, maintenence

Income: All based on yields, commodity prices, politics

Uncontrollable variable: WEATHER

I guess my basic question is: How do you make money, especially if you're leasing acreage? How does the set-aside acreage help you in times of high crop prices?, and does the commodity market hurt more than help?

Thanks!

9:15 AM, November 22, 2006  
Blogger bgunzy said...

Dem, you're just about right - it is a low margin business.

Inputs - Seed, chemicals, fertilizer. These all seem to go up every year, especially seed. Fertilizer is becoming more and more pegged to natural gas futures. Seed has more genetic potential for yield than before, along with GM traits that protect the seed.

Fuel - One can hedge against rising fuel costs. In a no-till operation this is not a super big cost, as compared to plowing operations.

Maintenance and repairs - do as much of it yourself. Tools are an investment.

Machinery - keeping costs low here is important, but not so much that you can't get everything done in a timely manner and your repair bills go up.

Rent - A lot of times cheaper than buying land and making payments. I'd rather have long term leases with good landlords than tie up hundreds of thousands of dollars buying land at inflated prices.

Marketing - I like to lock in future prices. I hate "taking" prices, I'd rather set a goal and if the market gets there, I'll reward it.

Gov't programs - Add a fair amount of net income to the operation at times.

Commodity markets - like them or not, they are there, and we have to work with the system. I'd rather the markets, however, than having to take prices someone else offers.

Crop insurance helps protect against low yields and/or low prices - revenue assurance programs.

Set-aside - We don't have a true set-aside program right now; used to before the 1995 farm bill. CRP is a detriment to expansion "here" as we have a lot of local ground tied up in it. If that were released it would lower land rents.

If one can net $40-50/ac after expenses, even after living expenses, you're doing pretty good. That's why farms are 1000+ acres these days rather than 160 as they used to be.

Does this help, Dem?

12:36 PM, November 22, 2006  
Anonymous Russ from Winterset said...

Don't forget "sharing" as a cost-cutting measure, bgunzy. I grew up within four miles of my uncle's family, and two of my dad's cousins lived within another 10 miles. All of them farm, and my dad & his brother still share ownership of a lot of equipment (big round baler, stock trailer, combine, their uncle's old two-row ear corn picker, and smaller hand tools like drill press & welder). We've even had neighbors borrow equipment, like the guy who used to borrow our manure spreader for his horse hobby farm and repay us by coming over with his horses when it was time to round up the cattle & precondition the calves. One of my dad's cousins does all the row-crop farming on our place right now on shares, and the other one uses his semi to haul some of the corn to Eddyville when the price differential works out.

6:04 PM, November 22, 2006  
Anonymous Anonymous said...

It seems to me that more than half of the anhydrous will be lost by the time spring planting is done and roots from the 2007 crop begin to develop. Why not pay a little more and see all of this taken up by your new crop?

9:44 PM, November 22, 2006  
Blogger bgunzy said...

The idea is that if the NH3 is sealed into the soil in the fall, it will lock onto soil particles immediately. Microbes that would denitrify the NH3 and cause it to leach are dormant when the soil is cold (under 50 degrees F). In soils with higher clay content, where there are more particles per volume than in, say, sandy soils, NH3 seems to keep better over the winter.

If I had sandier soils I would side-dress the nitrogen (put in on between the rows when the corn is about 4-6" tall). However, according to the yields around here (and in N Iowa), where a lot of fall applied NH3 went on, I don't think a lot of nitrogen was lost - but there's always a chance it could.

7:41 AM, November 23, 2006  
Blogger IrishWalsh said...

I was actually trying to associate the substance with kicking the corn growth into overdrive (like meth), not actual meth. Even if NH3 is one of the ingredients. But I get what your saying.

It was a bad joke is all.

11:28 AM, November 27, 2006  
Blogger bgunzy said...

Did the joke end with "you get stuck in Iraq" or "you get US stuck in Iraq"? :)

12:37 PM, November 27, 2006  
Blogger IrishWalsh said...

Knock Knock!
Who's There?
Interrupting Politician who accidentally insults constituents!
Interrupting Politician who accidentally insults const—
SENIOR CITIZENS ARE LAZY!

9:25 PM, November 27, 2006  

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